Holland v. Keesler Federal Credit Union

Filing 74

Memorandum Opinion and Order Denying Defendant Keesler Federal Credit Union's Motion for Summary Judgment 42 , and Granting Plaintiff's Federal Rule of Civil Procedure 56(d) Motion 60 . Signed by District Judge Halil S. Ozerden on December 22, 2016. (BGL)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF MISSISSIPPI
SOUTHERN DIVISION
STEVEN W. HOLLAND

PLAINTIFF

v.

CIVIL NO. 1:15-cv306-HSO-JCG

KEESLER FEDERAL CREDIT UNION

DEFENDANT

MEMORANDUM OPINION AND ORDER DENYING
DEFENDANT KEESLER FEDERAL CREDIT UNION’S MOTION
FOR SUMMARY JUDGMENT [42], AND GRANTING PLAINTIFF’S
FEDERAL RULE OF CIVIL PROCEDURE 56(d) MOTION [60]
BEFORE THE COURT is Defendant Keesler Federal Credit Union’s Motion
for Summary Judgment [42] filed July 29, 2016, and Plaintiff Steven W. Holland’s
Federal Rule of Civil Procedure 56(d) Motion [60] filed in response on September 20,
2016. Having considered the parties’ submissions, the record as a whole, and
relevant legal authority, the Court is of the opinion that Defendant’s Motion for
Summary Judgment [42] should be denied, and Plaintiff’s Rule 56(d) Motion [60]
should be granted.
I. BACKGROUND
A.

Factual Background
On March 8, 2010, the late Claude A. Holland and Bobbie B. Holland,

husband and wife, executed a Promissory Note in the amount of $155,000.00
payable to Defendant Keesler Federal Credit Union (“Keesler”) secured by a Deed of
Trust on their house at 20 Oakwood Drive, Gulfport, Mississippi 39507 (the
“Subject Property”). Aff. Delma Powell (“Powell”) [42-7] at 1-2. On September 2,
2013, Plaintiff Steven W. Holland’s (“Plaintiff”) mother, Bobbie B. Holland, who was

predeceased by her husband, passed away. Compl. [1] at 2. Plaintiff and his
brothers James Holland and Scott Allen Holland (“Scott”), are the children of the
late Claude A. Holland and Bobbie B. Holland (collectively, “Parents”). Pl. Dep. [672] at 5.
Plaintiff alleges that after their mother’s death, he and Scott “spoke with a
representative of Keesler” named “Cindy” to inform Keesler of their mother’s death,
and that they subsequently provided Keesler with a copy of her death certificate.
Id. at 3, 9. Scott then spoke with a “Ms. Hallman” who agreed on behalf of Keesler
to accept “an interest-only payment for six months so that [they] could figure out
what [they] were going to do” with the Subject Property. Id. at 10. Scott began
making interest-only payments to Keesler on the Promissory Note. Id. At some
point, Scott informed Plaintiff that a new “collection agent” had taken over the
account and that they were now required to pay the full monthly amount of the
Note as well as catch up the outstanding amounts due on the prior monthly
payments. Id. Plaintiff made “six to eight” payments to Keesler in varying
amounts. Id. at 11-12.
On January 29, 2015, Kelly M. Poulos (“Poulos”), an employee of Keesler,
wrote Plaintiff and returned a check from him in the amount of $1,400.00. Poulos
informed Plaintiff that Keesler would “no longer accept payments or payment
arrangements on this loan” because the Subject Property had not been “placed on
the market and sold,” and Keesler had “no other choice but to call the [N]ote due to

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protect our interest in the property.” Poulos Letter [42-12] at 1. In response, on
February 4, 2015, Plaintiff wrote Poulos to notify Keesler that improvements were
being made to the house prior to putting it on the market, and to request that
Keesler respond to his request for a loan modification. Pl. Letter [42-12] at 2-3.
Plaintiff provided his office and cellular telephone numbers, and asked that Keesler
call him to discuss the matter. Id. After receiving no response to his February
letter, Plaintiff wrote Keesler twice more, on March 2, 2015, and April 6, 2015,
asking that Keesler transfer the title to the Subject Property into Plaintiff and
Scott’s names pursuant to “Federal law, as well as State of Mississippi statutes
regarding the transfer or (sic) real property to the heirs of deceased parents,” and
asserting that the “Garn St. Germain Depository Institutions Act of 1982 prohibits
any due on sale clause from being invoked” such that Keesler’s acceleration of the
mortgage was improper. Pl. Letters [42-12] at 4, 5.
Keesler purchased the Subject Property at a foreclosure sale on June 9, 2015,
pursuant to the terms of the Deed of Trust. Keesler Mem. in Supp. [43] at 2.
Plaintiff learned of the foreclosure sale when a “locksmith came onto the property
and changed the locks and told my son that, yes, Keesler had foreclosed on the
property and that we no longer owned it.” Pl. Dep. [67-2] at 28.
On August 3, 2015, Keesler filed a “Complaint for Unlawful Entry and
Detainer” in the County Court of Harrison County, Mississippi, naming as
Defendants Plaintiff’s Parents and “any other unknown tenants or occupants” of the

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Subject Property. Keesler Mem. in Supp. [43] at 2. Plaintiff was aware of the
Complaint and that a hearing was set for September 2, 2015; however, he did not
attend. Pl. Dep. [67-2] at 29. A “Judgment in Unlawful Detainer” was entered on
September 2, 2015. J. [42-4] at 1-2.
B.

Procedural Background
On September 15, 2015, Plaintiff filed a Complaint [1] in this Court against

Keesler advancing two causes of action: (1) Violation of the Telephone Consumer
Protection Act (“TCPA”), 47 U.S.C. § 227; and (2) Wrongful Foreclosure under the
Garn St. Germain Depository Institutions Act, 12 U.S.C. § 1701j-3(d). Compl. [1] at
7-9. Plaintiff seeks a judgment for compensatory damages, punitive damages, costs,
and interest. Id.
Keesler filed its Motion for Summary Judgment [42] on July 29, 2016.
Kessler asserts that: (1) Keesler did not violate the TCPA because Keesler does not
have an “automated telephone dialing system,” Keesler Mem. in Supp. [43] at23-28;
Powell Aff. [42-7] at 2; and (2) Keesler did not wrongfully foreclose because
“following the death” of the Parents, “the Note went into default due to nonpayment,” and the “lawful foreclosure” occurred when the default was not “cured,”
Keesler Mem. in Supp. [43] at 10; Powell Aff. [42-7] at 2.
On September 20, 2016, Plaintiff filed a Rule 56(d) Motion in Opposition [60]
alleging in pertinent part that
In order for Plaintiff to establish his claim that Defendant
violated the TCPA with respect to the Plaintiff, he will be required to

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prove the two elements of a TCPA claim: that Defendant made (1) a call
to Plaintiff’s cellular telephone; (2) using an “automatic telephone
dialing system” (“ATDS”) or an “artificial or prerecorded voice.”
David P. Mitchell Aff. [62] at 3, ¶ 8. Plaintiff contends that
[a]s of the date of the filing of this Motion, Plaintiff has still not
received many of the essential discovery materials that would enable
him to properly respond to Defendant’s Motion for Summary Judgment
(Dkt. 42) and Memorandum of Law in Support Thereof (Dkt. 43), which
materials are within Defendant’s exclusive possession and control. For
this specific reason, Plaintiff cannot currently present facts essential to
justify his opposition [to] Defendant’s Motion for Summary Judgment
(Dkt. 42) and Memorandum of Law in Support Thereof (Dkt. 43).
Pl. Rule 56 (d) Mot. [60] at 1. Plaintiff requests that the Court either stay or deny
Keesler’s Motion for Summary Judgment pending the completion of discovery
and/or the entry of an order on Plaintiff’s pending Motion to Compel [57]. Id. at 2.
Plaintiff maintains that “Defendant’s withholding of the discovery materials
outlined in Plaintiff’s Motion to Compel (Dkt. 58) has directly prevented Plaintiff
from obtaining evidence necessary to establish the elements of his TCPA claim and
to oppose Defendant’s Motion for Summary Judgment (Dkt. 42).” Pl. Mem. in Supp.
[61] at 5-13; Aff. David P. Mitchell [62] at 1-6.
In its Rebuttal [69] in support of its Summary Judgment Motion, Keesler
maintains that it is entitled to summary judgment on both the TCPA and wrongful
foreclosure claims because
Plaintiff wholly ignores (or concedes) Defendant’s arguments regarding
the Plaintiff’s claim for wrongful foreclosure, and only responds
(insufficiently) to Defendant’s arguments regarding alleged violation of
the Telephone Consumer Protection Act (“TCPA”). However, Plaintiff
summarily fails to provide any sworn proof or evidence as to any of

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Plaintiff’s allegations in the Complaint. There is absolutely nothing
before the Court which is sworn to which supports any element of any
claim in the Complaint (save one self-serving, conclusory affidavit
executed by Plaintiff’s own lawyer, for the proposition that the Plaintiff
needs more time to respond and more discovery).
Rebuttal [69] at 2.
II. DISCUSSION
A.

Summary Judgment Standard
“Summary judgment is appropriate when there is no genuine issue as to any

material fact, and the moving party is entitled to judgment as a matter of law.” Cox
v. Wal-Mart Stores E., L.P., 755 F.3d 231, 233 (5th Cir. 2014); see Fed. R. Civ. P.
56(a). In deciding a motion for summary judgment, a court “view[s] the evidence
and draw[s] reasonable inferences in the light most favorable to the nonmoving
party.” Hemphill v. State Farm Mut. Auto. Ins. Co., 805 F.3d 535, 538 (5th Cir.
2015) (quoting Cox, 755 F.3d at 233); Maddox v. Townsend & Sons, Inc., 639 F.3d
214, 216 (5th Cir. 2011). Before it can determine that there is no genuine issue for
trial, a court must be satisfied that “the record taken as a whole could not lead a
rational trier of fact to find for the non-moving party.” Matsushita Elec. Indus. Co.
v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). If the movant fails to carry the
initial burden, “summary judgment must be denied – even if the nonmoving party
has not responded to the motion.” John v. Louisiana, 757 F.2d 698, 708 (5th Cir.
1985) (citation omitted).

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If the movant carries this burden, “the nonmovant must go beyond the
pleadings and designate specific facts showing that there is a genuine issue for
trial.” Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994) (en banc); see
also Lujan v. National Wildlife Federation, 497 U.S. 871, 888 (1990) (the nonmovant
must set forth specific facts to contradict the specific facts set forth by the movant,
general averments are not sufficient).
To rebut a properly supported motion for summary judgment, the opposing
party must show, with “significant probative evidence,” that there exists a genuine
issue of material fact. Hamilton v. Segue Software, Inc., 232 F.3d 473, 477 (5th Cir.
2000). “A genuine dispute of material fact means that evidence is such that a
reasonable jury could return a verdict for the nonmoving party.” Royal v. CCC&R
Tres Arboles, LLC, 736 F.3d 396, 400 (5th Cir. 2013) (quotation omitted). An actual
controversy exists “when both parties have submitted evidence of contradictory
facts.” Salazar-Limon v. Houston, 826 F.3d 272, 277 (5th Cir. 2016) (quotation
omitted).
B.

Federal Rule of Civil Procedure 56(d) Standard
Federal Rule of Civil Procedure 56(d) provides that:
[i]f a nonmovant shows by affidavit or declaration that, for
specified reasons, it cannot present facts essential to justify its
opposition, the court may:
(1)
defer considering the motion or deny it;
(2)
allow time to obtain affidavits or declarations or to take
discovery; or
(3)
issue any other appropriate order.

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Fed. R. Civ. P. 56(d). A party seeking relief under Rule 56(d) must show that it has
exercised due diligence in the pursuit of discovery. McKay v. Novartis Pharm.
Corp., 751 F.3d 694, 700 (5th Cir. 2014) (citation omitted). The party cannot rely on
vague assertions but must show why he needs additional discovery and how that
discovery will create a genuine issue of material fact. Smith v. Reg’l Transit Auth.,
827 F.3d 412, 422-23 (5th Cir. 2016). A request to stay under this Rule must also
“set forth a plausible basis for believing that specified facts, susceptible of collection
within a reasonable time frame, probably exist and indicate how the emergent facts,
if adduced, will influence the outcome of the pending summary judgment motion.”
Am. Family Life Assur. Co. v. Biles, 714 F.3d 887, 894 (5th Cir. 2013) (quoting Rule
56(d)).
Under Rule 56(d), deferring summary judgment is appropriate if the nonmoving “shows by affidavit or declaration that, for specified reasons, [he] cannot
present facts essential to justify” his opposition to a summary judgment motion.
Mendez v. Poitevent, 823 F.3d 326, 336 (5th Cir. 2016) (citation omitted). Rule 56(d)
discovery motions are “broadly favored and should be liberally granted.” Smith, 827
F.3d at 422-23 (quotation omitted).
C.

Analysis
Keesler filed its Motion for Summary Judgment [42] on July 29, 2016.

Kessler’s Motion asserts that: (1) Keesler did not violate the TCPA because Keesler
does not have an “automated telephone dialing system,” Keesler Mem. in Supp. [43]

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at 23-28; Delma Powell Aff. [42-7] at 2; and (2) Keesler did not wrongfully foreclose
because “following the death” of the Parents, “the Note went into default due to nonpayment,” and the “lawful foreclosure” occurred when the default was not “cured,”
Keesler Mem. in Supp. [43] at 10; Delma Powell Aff. [42-7] at 2. Having considered
the parties’ submissions, the record as a whole, and relevant legal authority, the
Court is of the opinion Defendant’s Motion for Summary Judgment [42] should be
denied, and Plaintiff’s Rule 56(d) Motion [60] should be granted.
1. Keesler has not met its burden to prove that there exist no genuine issues
of material fact as to whether Keesler violated the TCPA.
Keesler argues that Plaintiff has failed to set forth any documentation or
facts to support its TCPA claim. In his Rule 56(d) Motion, Plaintiff asserts that
Keesler has failed to produce the documentation that would have provided Plaintiff
with these facts.
For example, in his Requests for Production of Documents, Plaintiff sought
copies of documents related to Keesler’s loan on the Subject Property and to the
phone calls made by Keesler to Plaintiff’s cell phone. In responding to the Requests,
Keesler admits that it has documents responsive to Plaintiff’s Requests, but objects
to their production, as follows:
KFCU maintains collection call logs relating to the loan made to Claude
Holland and Bobbie Holland. KFCU objects to currently producing
documents relating to the loan of Bobbie Holland and Claude Holland
as the same are or may be protected by the Fair Credit Reporting Act of
1970 (“FCRA”), Gramm-Leach-Bliley Act (“GLBA)”, and Right to
Financial Privacy Act (“RFPA”), among other various federal laws. In
order to produce any such documents, Defendant must be provided with

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an executed waiver and authorization to release the same from the duly
authorized representative of Bobbie Holland and Claude Holland.
See Keesler Mem. in Opp’n [68] to Pl. Mot. to Compel [57] at 11-18.
It appears to the Court that the documents requested by Plaintiff are
relevant and necessary in order for Plaintiff to attempt to prove his TCPA
claim and to oppose Defendant’s Motion for Summary Judgment. Keesler’s
objection to the production of the requested documents consists of a broad
sweeping reference to federal statutes, and does not provide any case
authority that supports its interpretation of the federal laws as applied to the
facts of this case.
Plaintiff also argues that Keesler failed to produce documentation that
would prove that Keesler did, during the relevant time period, have an
automated telephone dialing system, although Keesler maintains in its
Motion [42] that it did not. Keesler Mem. in Supp. [43] at 23-28; Delma
Powell Aff. [42-7] at 2. To support its position, Keesler offers Powell’s July
29, 2016, Affidavit in which Powell avers that Keesler “does not have an
‘automated calling system,’ or, an ‘autodialer.’” Keesler Mem. in Supp. [43] at
24 (citing Powell Aff. [42-7]).
Plaintiff counters with Powell’s September 13, 2016, Rule 30(6)(b)
Deposition testimony on behalf of Keesler. See Keesler Rule 30(6)(b) Depo.
[58-6]. Plaintiff posits that Keesler, through its designee Powell, admitted
that Keesler acquired an “Interactive Client system” in late 2014 or early

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2015, that Keesler possesses copies of the acquisition agreement, and that
Keesler utilizes a prerecorded message at the beginning of every collection
call. Mem. Rule 56(d) Mot. [61] at 11-12; see also Keesler Rule 30(6)(b) Depo.
[58-6] at 17, 28-29. Keesler’s Rebuttal does not address the issue of whether
Keesler’s utilization of a prerecorded message at the beginning of collection
calls to Plaintiff’s cell phone could potentially qualify as a TCPA violation,
nor does it address Powell’s testimony that “copies of contracts” reflecting the
purchase of “systems and software” exist.
Viewing Keesler’s Motion in the light most favorable to Plaintiff, the
Court finds that at this juncture Keesler’s Motion for Summary Judgment on
the issue of Plaintiff’s TCPA claim should be denied as premature, Plaintiff’s
Rule 56(d) Motion should be granted, and Plaintiff should be allowed to
conduct further discovery as to the TCPA claim.
2. Keesler has not demonstrated the absence of a material fact question as to
whether Keesler wrongfully foreclosed on the Subject Property.
Viewing the summary judgment record in the light most favorable to
Plaintiff, a fact question remains at this juncture on whether Defendant’s
foreclosure on the Subject Property may have violated the Garn St. Germain
Depository Institutions Act, 12 U.S.C. § 1701j-3. This Act preempts state law and
allows a lender to exercise a due-on-sale clause if a borrower sells or otherwise
transfers property without prior written consent. See 12 U.S.C. § 1701j-3(a)(1).
However, the Act exempts certain transfers including “a transfer to a relative

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resulting from the death of a borrower.” See Brush v. Wells Fargo Bank, N.A., 911
F. Supp. 2d 445, 460 (S. D. Tex. 2012) (quoting 12 U.S.C. § 1701j-3(d)(5)).
Plaintiff asserts, and Keesler does not deny, that he is one of three children of
the late Parents who executed the Promissory Note and Deed of Trust on the
Subject Property. Under Mississippi law, in the absence of a will otherwise devising
the property, pursuant to Mississippi Code Annotated § 91-1-31 title to a decedent’s
property “automatically vests in [their] lawful heir or heirs upon [their] death
without instituting any legal proceedings.” In re Will of Wilcher v. Wilcher, 994 So.
2d 170, 174-76 (Miss. 2008); see also In re Estate of Mace v. Gardner, 66 So. 3d 1265,
1268 n.1 (Miss. Ct. App. 2011) (“by operation of law, in the absence of a will, title of
real property vests immediately in the heirs at law upon the owner’s death”).
Under Mississippi law, it appears that upon his mother’s death, Plaintiff
automatically inherited some share of the Subject Property by operation of law.2 If
Keesler initiated foreclosure on the Subject Property based upon the death of
Plaintiff’s mother and the transfer of title to the Subject Property to Plaintiff,

Mississippi Code Annotated § 91-1-3 provides in pertinent part that “[w]hen any
person shall die seized of any estate of inheritance in lands, tenements, and
hereditaments not devised, the same shall descend to his or her children . . . in
equal parts . . . .”
1

Neither party has referenced or attached any document purporting to be Bobbie
B. Holland’s will. Based upon the record before the Court, it appears that she died
intestate.

2

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Keesler may have violated § 1701j-3(d)(5) of the Garn St. Germain Depository
Institutions Act.
Keesler maintains that foreclosure was lawfully initiated because the Note
was in default. Keesler Mem. [43] at 10; Powell Aff. [42-7] at 2. Plaintiff responds
that he and his brother Scott had made payments on the Note and that it was
current until the date Keesler returned a check in the amount of $1,400.00 and
informed him that it was going to “call the note” to protect its interest in the Subject
Property. Plaintiff Dep. [25] at 11-13, 25-26; Poulos Letter [42-12] at 1.
At this summary judgment stage, the Court may not “weigh the evidence” or
make “credibility determinations.” Heinsohn v. Carabin & Shaw, 832 F.3d 224,
245-46 (5th Cir. 2016). At this stage of the case and based upon the present briefs
and evidence before it, the Court cannot say that no genuine material issues of fact
exist as to whether the foreclosure of the Subject Property was conducted in
violation of federal law. Defendant’s Summary Judgment Motion as to the wrongful
foreclosure claim should be denied.
III. CONCLUSION
Defendant Keesler Federal Credit Union has not carried its summary
judgment burden and its Motion for Summary Judgment [42] will be denied.
Plaintiff Steven W. Holland’s Federal Rule of Civil Procedure 56(d) Motion [60] will
be granted.

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IT IS, THEREFORE, ORDERED AND ADJUDGED that Defendant
Keesler Federal Credit Union’s Motion for Summary Judgment is DENIED.
IT IS, FURTHER, ORDERED AND ADJUDGED that Plaintiff Steven W.
Holland’s Federal Rule of Civil Procedure 56(d) Motion [60] will be GRANTED.
IT IS, FURTHER, ORDERED AND ADJUDGED that the parties are
directed to contact the Magistrate Judge within 14 days to obtain an amended Case
Management Order.
SO ORDERED this the 22nd day of December, 2016.

s/ Halil Suleyman Ozerden
HALIL SULEYMAN OZERDEN
UNITED STATES DISTRICT JUDGE 

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